Small increase in cross-net mobile traffic

Telco Commissioner reports 'early encouraging trends' following regulation

Since mobile termination rates were regulated in May, there has been a small increase in cross-net mobile traffic, telecommunications commissioner Ross Patterson says.

“While these early trends are promising, and are definitely heading in the right direction, there is still a long way to go,” Patterson says, in a media statement accompanying the release of the mobile monitoring report.

The report shows that traffic across mobile networks has increased in the three month period from May – July 2011 and the difference between the cost of calls within a network and between networks has narrowed.

“Between May and July 2011, cross network traffic increased by 1.2 percent for mobile calls and by 2.9 cent for text messages. At the same time, the price difference between on-net calls and off-net services decreased by 4.4 percent for mobile calls and for 3.4 percent for text messages,” the commission report states.

“The Commission expects that the price differential will continue to decrease.”

Mobile termination rates – the fees telcos charge each other to terminate traffic on their networks – were cut from around 15-17 cents to about 7.5 cents for voice calls (and will drop to 4 cents by April 2012) and to 0.06 cents for text messages, following regulation that came into effect on May 6.

At the time Patterson stopped short of banning on net/off net price discrimination (that is pricing plans which favour customers who only call other customers on the same network), but he said the Commission would monitor the market on a monthly basis and that it had the power to legally intervene.

The Commission will continue to monitor cross-net traffic on a monthly basis, with the next report covering the August – October 2011 period due out in December.

“It’s what happens in the next few months that will be critical,” says Patterson.

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